Publication year

Tsai Ing-wen’s and her DPP’s victory will increase tensions with China, though an escalation to crisis levels seems not very likely. Growth took a hit in 2015 and is likely to recover in 2016, but external factors create substantial uncertainties.

Thailand is heading for extended military rule, as the National Assembly rejected the proposal for a new constitution paving the way to early elections. Economic growth remains relatively weak, forcing the government to revert to populist economic policies.

Institutional quality and economic development reinforce each other over the longer term, but we argue that institutional quality leads this virtuous circle. It unlocks growth potential and does not intrinsically suffer from diminishing returns.

The economic growth outlook has worsened due to less favorable global outlook, which keeps key commodity prices low. The risk of a sharp correction of house prices in Auckland has induced the government to implement additional macro-prudential measures.